The runes on this ring you found are still legible: it was given to "Kalytha" when she was granted admission to the Academy. With the right spell or two, this personal trinket of hers is the gateway to her soul.

Take the ring back to Lake Mennar. Kalytha's spirit should now be visible to you on the shore of the lake. Touch her and the ring will allow you to see the world as she sees it, forever reliving her final hours. Probe her mind, <name>! Speak to the others and learn the secrets of Lake Mennar...

Kalytha ... it is done. The Sarcen Stone is fully charged and is already diverting energy from the portal. Are you still the incredible swimmer I knew those many years ago? The stone must not be found by either the demons or our "beloved" Queen.

Swim to the bottom of the lake, Kalytha, and bury the stone deep under the center arch. Hopefully the demonic invaders will not discover it when they raze the surrounding temple. Go!